New York October 15, 2007 1 Disclaimer This presentation may - - PowerPoint PPT Presentation

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New York

October 15, 2007

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Disclaimer

”This presentation may contain statements that express management’s expectations about future events or results rather than historical facts. These forward-looking statements involve risks and uncertainties that could cause actual results to differ materially from those projected in forward-looking statements, and CVRD cannot give assurance that such statements will prove

• correct. These risks and uncertainties include factors: relating to the Brazilian

and Canadian economies and securities markets, which may exhibit volatility and can be adversely affected by developments in other countries; relating to the iron ore business and its dependence on the global steel industry, which is cyclical in nature; and relating to the highly competitive industries in which CVRD operates. For additional information on factors that could cause CVRD’s actual results to differ from expectations reflected in forward-looking statements, please see CVRD’s reports filed with the Brazilian Comissão de Valores Mobiliários and the U.S. Securities and Exchange Commission.”

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Roger Agnelli

Chief Executive Officer

On the growth path

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■ Our value proposition ■ The long-term fundamentals ■ Shaping the future: investing US$ 59 billion ■ Capex budget for 2008 ■ Vision and values

Agenda

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Our value proposition

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Simultaneously with investment in successful acquisitions, 72% of our capex has been dedicated to growth¹

Growth investment/Capex in %

2002 2003 2004 2005 2006 1H07

Projects R&D

60.5 67.9 68.6 77.4 71.9 71.0

¹ Project development and research development

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The growth process has been firmly anchored on a rigorous discipline on capital allocation

5.4 7.5 11.1 31.2 41.2 46.8% 54.7% 64.4% 54.3% 54.2% 2003 2004 2005 2006³ LTM 2Q07³ Capital invested US$ billion ROIC %

¹ PP&E + working capital + R&D

2 before income taxes 3 excludes effect of extraordinary inventory adjustments

Return on capital invested

1 2

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Our value proposition is being delivered: a steady and strong growth

LTM EBITDA US$ billion

15.6 12.5 10.1 8.3 7.3 7.2 6.5 5.8 5.0 4.0 3.7 3.3 2.9 2.4 2.1 2.0 1.9 1.8 1.8 1.7 1.6 1.5

1Q02 2Q02 3Q02 4Q02 1Q03 2Q03 3Q03 4Q03 1Q04 2Q04 3Q04 4Q04 1Q05 2Q05 3Q05 4Q05 1Q06 2Q06 3Q06 4Q06¹ 1Q07¹ 2Q07¹

1 excluding extraordinary effect of inventory adjustment

Quarterly EBITDA volatility Total 0.82 % upward 72% % downward 28%

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Growth spearheaded a dramatic increase in market capitalization and high TSR performance - 80.1% p.a.¹

1 January 1, 2002 to September 30, 2007

20 40 60 80 100 120 140 160

2002 2003 2004 2004 2006 2007

CVRD’s market cap US$ billion

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Thriving in the global arena: becoming one of the largest companies

Position among the 500 largest companies in the world by market cap

2002 2003 2004 2005 2006 March 2007 September 2007 Ranking

Source: Financial Times – FT 500 and Bloomberg

500 400 300 200 100 1

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74

117

153

275

334

446

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The long-term fundamentals

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■Low inflation rates. ■Low real interest rates. ■High productivity growth. ■Globalization and emerging markets secular growth. Despite short-term volatility, we are confident on the strength of the long-term fundamentals of the global economy

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Global GDP growth is being driven by emerging market economies, the drivers

• f minerals and metals demand increase

Contribution to global GDP¹ growth

Developed economies 46% USA 19% China 22% Emerging market economies 54%

Average 1989-98 3.2% p.a.

Emerging market economies 73% China 33% USA 10% Developed economies 27%

Average 2005-07 5.3% p.a.

1 Global GDP at PPP. Emerging market economies are responsible for 48% of global GDP and 84.7% of world population

Source: IMF

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■Urbanization – Housing – Infrastructure – Consumer durables ■Industrialization Emerging market economies are expected to continue to produce a structural change in the demand for minerals and metals

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China will have an increasing influence

• n the global demand for minerals and

metals

2000 2006 2011E Iron ore¹ 15.4 45.0 54.0 Nickel 4.9 17.3 31.0 Aluminum 14.0 25.5 41.0 Copper 12.7 21.0 30.0

Chinese share in global consumption %

¹ share of Chinese imports in seaborne trade Sources: CRU and CVRD

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Shaping the future: investing US$ 59 billion

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■ Acceleration of investments: US$ 59 billion for next five years against US$ 18 billion¹ during 2003-2007. ■ Focus on organic growth:project development and mineral exploration ■ Massive investment in the development of world-class assets – iron ore, pellets, coal, nickel, copper, bauxite and alumina. ■ Enhancement of infrastructure (logistics and power generation) to support the expansion of our activities.

Confidence on long-term global fundamentals underlies the continuity of our strategy to deliver strong and steady growth

¹ does not include expenditures in acquisitions

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Execution of the organic growth pipeline will give rise to a significant production expansion

2003 2007E 2008E 2012E CAGR CAGR 07-12 03-07 Iron ore 186.0 300.0 325.0 422.0 7.1% 12.7% Pellets¹ 13.0 17.6 20.0 33.0 13.4% 7.9% Coal

• 2.9

7.6 15.2 39.3%

• Nickel 2,3
• 260.0

280.0 507.0 14.3%

• Copper²
• 290.0

300.0 592.0 15.3%

• Alumina

2.3 4.3 5.3 8.2 13.8% 16.9%

million metric tons

¹ does not include production of JVs (Samarco, Nibrasco, Hispanobras, Kobrasco, Itabrasco). Attributable production in 2007 is expected to reach 18 Mt. Samarco 3rd pellet plant (7.6 Mtpy) is coming on stream in 1H08. ² 1,000 metric tons ³ does includes volumes of finished nickel produced under tolling agreements with concentrates purchased from third parties

Running at 450Mtpy

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■Discipline on capital allocation. ■Excellence in research, project development and operations. Our growth process is strongly anchored

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■ Financing of the organic growth pipeline is our highest priority. ■ Maintenance of a sound balance sheet with a low-risk debt profile. ■ Satisfaction of dividend aspirations of our shareholders.

No changes in our priorities for cash flow allocation

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■Skilled labor. ■Environmental permits. ■Supply of equipment and engineering services. ■Energy. The challenges

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Capex budget for 2008

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The capex budget for 2008: US$ 11 billion

■ The largest annual investment program ever for a mining company. ■ US$ 8.4 billion – 77% - dedicated to growth (project development and R&D). ■ Development of 30 major projects.

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Capex budget 2008

US$ billion

Projects 68.7% Sustaining capex 23.3% R&D 8.0%

By category

1 US$ 349 million will be invested in mineral exploration

By business area

Coal 3.5% Logistics 17.0% Power generation 4.3% Other 5.8% Ferrous minerals 29.6% Aluminum 6.9% Non-ferrous minerals 32.9%

25 Canada Brazil Mozambique

A global investment program

Iron ore & pellets Nickel Coal Copper Bauxite & alumina Phosphates Logistics Power generation

Peru Chile Australia New Caledonia Indonesia Oman

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Iron ore & pellets Nickel Coal Copper Bauxite & alumina Phosphates Logistics Power generation Steel

Brownfield Greenfield

2008 2010

Goro

Developing an exciting pipeline of world-class assets

2009 2011 2012

Reference

US$ 1 billion Onça Puma Itabiritos Fazendão Northern Corridor Alunorte 6&7 Paragominas II Papomono Carajás 130 Mtpy Southern Corridor Carborough Downs Equatorial Barcarena Salobo I Tubarão VIII Oman Estreito Bayovar Karebbe Voisey’s Bay Paragominas III Southern Range NAR Moatize Litoranea Totten Maquiné-Baú Vermelho Eastern Range CSA CSV Setentrional

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Vision and values

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Our growth initiatives are driven by our long-term vision… “To become the largest mining company in the world and to excel in research, project development and operations“

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■Ethics and transparency. ■Performance excellence. ■Entrepreneurship. ■Corporate social responsibility. ■Deep respect for life and diversity. ■Proud to be CVRD. … and sustained by our core values

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Carla Grasso

Executive Director of Human Resources and Corporate Services

Managing the change: HR and procurement

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CVRD HR . Policies with focus in Brazil . Brazilian staff . Support to operations in Brazil . Beginning of Organizational Development support HR Brazil: . Policies with focus in Brazil . Support to operations in Brazil . Organizational Development support by business.

CVRD HR Structure – “Process evolution”

2004 2005 2007 2006

Up to 2004:

HR Brazil

From 2005 up to June 2007:

HR Brazil + International HR

Global HR:

• Global Policies and

Processes

• Regional HR working on

local policies

• Organizational

Development support by business International HR:

• Development of

corporate HR guidelines to support international

• ffices
• Organizational

Development support by region/continent.

From July 2007:

Global HR

Transition National Global

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HR Strategic Planning – “The basis”

CVRD Strategy 5 years outlook with annual check-ins :

HR strategy prioritizing Education & Internal Development

HR Strategic Planning Organic growth New projects M&A’s Ongoing needs

“CVRD HR Starting point” “The enabler, the basis of an HR that make sense”

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Employee Assessment Career& Succession Committees

More than 400 in 2006… Coaching & Development Succession Planning Retention Strategies External Recruitment Internal Talent Pool

Employee Feedback

Team Development Plan Variable Payment Career & Succession follow ups

Leader & Employee dialogue

Career & Succession – “Cycle & numbers”

92% of managerial

position filled internally Succession Readiness :

81% Internally

19% Externally

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Valer Corporate University

Valer represents the company’s corporate education strategy, driving the learning and development of the professionals in the CVRD value chain. It is focused on articulated projects, with an overriding emphasis on sustained professional formation, the development of production capacity and the formation of leaders empowered to transform.

CVRD Corporate University

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VALER in numbers

Education Programmes - responsible for 60% of CVRD’s technical positions :

• Strong social inclusiveness tool increasing employability and
• Support the company sustainability strategy.

Commitment with CVRD’s growth - CVRD has increased 10 times its investments in Education over the last 5 years. Doing more with less - CVRD educational strategy has increased hours of training in relation to benchmark with excellence and efficiency.

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VALER Strategic Partners

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Across all capital intensive industries, companies treating procurement as a strategic function, generate faster and higher value

Procurement related activities within capital intensive organizations

Supplier related optimizations lead to: revenue/margins increase, loss minimization and cost reductions (up to 4% increase over previous savings); In mergers and acquisitions processes, procurement related synergies are often higher than 30% of the total merger value; Supply Management best practices unlock significant value in large Capex projects (~ 25% more value); Expanding procurement perimeter along the spending categories generate compliance and savings (> 5% higher); Organizations have to guarantee that suppliers are aligned with their main compliances structures such as social and environmental responsibility;

Source: Booz Allen & Hamilton, CAPS Research and The Executive Board

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Global Procurement at a glance: Commercial reach

Chile Shanghai, China Japan Argentina China South Africa Australia India Brazil HQ

Canada

Strategic Suppliers Procurement Offices

■ USD 5.5 bi total spending from strategic categories and projects implementations for 2008 ■ 400 Suppliers, 152 international from 29 countries ■ 23 categories with long-term strategic alliances

USA France

Switzerland Germany Austria Finland

Grand Britain

Holland Norway Italy Greece Sweden

Belgium

Brazil

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CVRD uses leading-edge processes/negotiation tools

Benchmarks and Trends source: Aberdeen Group, The Executive Board, Quadrem, Gartner Group, ATKearney

Acts as a global procurement team with centers of excellence in Brazil, Canada, Europe and Asia Establishes global partnerships in order to sustain its growth strategy and operations improvement Uses product lifecycle sourcing (design-to-source) in order to address Low Cost Countries (LCC) Adopts flexible bidding processes enabling suppliers to add value on the negotiation Manages nearly 100% of its total spend through its ERP system (Benchmark = 78%) Electronically enables all its suppliers via its ERP/Procurement Portal System (Benchmark = >50%)

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Procurement success is driven by a large source of value creation drivers

People Processes Tools

Global demand consolidation network Supplier Profile Database Price analysis and evolution tools CAPEX price evolution toolkit Contracts P&L monitoring Price benchmarking among industries Online access to bids historical record Electronically enabled negotiation tools (RFx, Reverse Auctions, Quotes Comparison) Global procurement structure Centralization of main processes for all global

• perations

Specialized category managers Renewed procurement staff Diversified talent portfolio background VALUE CREATION Strategic sources every single category Uses TCO methodology to set negotiation targets Vendor list enhancement throughout a global network Supplier integration for operational improvement Monitor technical KPIs and continuous development Develops commercial agreements optimizing tax and logistics

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Outstanding achievements by enabling procurement as a core value

3,465 3,884 1,910 6.81% 7.38% 12.54%

500 1000 1500 2000 2500 3000 3500 4000 4500

2005 2006 2007 YTD

• 5%

5% 15% Strategic Spend Savings

3.14% 6.03%

• 1.53%
• 2.21%

2006 2007 YTD

Accumulated Brazilian Inflation CVRD Accumulated Inflation Index

Cost saving programs sponsored by top management Multi-functional technical groups to challenge specifications and stimulate innovation Combined action plans with suppliers aiming productivity increase and total cost

• ptimization

Contingency and crisis management plans in place to assure production continuity

Procurement Commercial Performance

US$ Millions 2007 YTD until August

Note: Inflation Index only consider operational expenses

&

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Demian Fiocca

Executive Director Information Technology and Corporate Management

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A track record of fast organic growth

0.4 0.9 1.1 2.9 3.0 4.9 7.5 2 4 4 3 3 7 4 2002 2003 2004 2005 2006 2007e 2008p Capital invested US$ billion Projects delivered

Capex Projects

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CVRD - Operations CVRD INCO – Operations CVRD INCO – Commercial Exploration / Proyect CVRD - RDs

CVRD Samarco Itabrasco Kobrasco Nibrasco Hispanobrás TVV Valesul Urucum Albrás Alunorte CADAM MRN PPSA Ferro Gusa Carajás MBR FCA RDM RDME RDMN RD Asia Tokyo Docenave Arg. RD Asia Shanghai Rio Doce Austrália Rio Doce índia CVRDI Bayovar CLMA CMTR CVRD Venezuela Rio Doce Argentina Rio Doce South Africa Rio Doce Mozambique Tethys Mining Yankuang Longyu Belvedere Goro AMCI

Geographic and product diversification accelerated by M&A

CVRD Inco PTInco

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A renewed challenge to excellence

■ Rapid expansion brought unprecedented size and diversity ■ Strong growth opportunities to capture within a market with solid long term fundamentals. ■ Need to keep corporate foundations in good shape to cope with new complexity and preserve efficiency

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■ Corporate performance: at par with comparable global companies (HR, IT, Procurement…….) according to independent studies ■ Focus on excellence in corporate functions: dedicated area of Information Technology and Corporate Management ■ To keep CVRD fast growth under close coordination ■ To improve performance and increase reliability through global standards, processes and systems ■ To increase asset productivity and provide a safe environment by sponsoring a broader adoption of automation technologies

Excellence as a world class company

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… through some key initiatives …

Flexibility Local Needs Local Agility Standardization Global Simplicity Global Agility

To steadily leverage economies of scale and integrate new acquisitions efficiently, CVRD is continuously perfectioning its corporate foundation…

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… international deployment of its core processes and corporate systems, …

2007 2008 Beyond

ERP Brazil - 5000 users More 9 companies 2100 users CVRD International, FCA, MBR… Roll out to other companies

Until 2006

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Production control Inventory control Parts management Logistics Order control Purchasing

...

Where do we create more value?

… an Enterprise Business Intelligence Model, …

Production control Inventory control Parts management Logistics Order control Purchasing

Niquel

Production control Inventory control Parts management Logistics Order control Purchasing

Copper

Production control Inventory control Parts management Logistics Order control Purchasing

Iron Ore

CV CVRD’s Bu Busin siness Intelligenc gence e

Which trends can I benefit most of? Which will the best product portfolio in the coming years?

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Resulting in:

• Better asset utilization
• Higher productivity
• Higher efficiency
• Improved Safety
• Reduced operational risk

.. and broader adoption of automated solutions for mining and logistics …

15 15 30 60 200 30 84 118 210 330 2004 2005 2006 2007e 2008p New Projects Optimization

CVRD Automation Improvement Investments (US$ MM)

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… to accomplish our mission

■ To achieve the IT Strategic goals through the establishment

• f guidelines, architecture development e solutions
• ptimization

■ To apply automation technologies that contribute to

• perational excellence, safe workplace e environmental

sustainability ■ To lead and coordinate corporate excellence efforts, pursuing continuous improvement in governance, processes, rule making and compliance. Information Technology and Corporate Management Area

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CVRD Logistics Supporting Growth

Eduardo Bartolomeo

Executive Director of Logistics

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Logistics overview and strategic drivers Logistics performance and investments

Iron ore and coal General cargo

Operational excellence drivers

“Green railroad”

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OPERATIONAL FIGURES 10,179 kilometers railroad network 1,008 locomotives and 41,761 wagons 6 Ports and Terminals THESE ASSETS PROVIDE FOR… 16% of cargo transported in Brazil and 30% of the cargo handled in Brazilian Ports 230.9 million tons of iron ore shipped through CVRD Port Complexes in 2006 24.6 million tons of general cargo shipped through port terminals in 2006

EFC EFVM FCA Port Terminals Multimodal Terminal FNS (EFC operation) FERROBAN Trackage right

CVRD provides integrated logistics services including railroads and ports terminals

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We want the reputation of being the safest and most efficient logistic provider

Increase competitiveness in mining operations, mainly iron ore and coal In general cargo, focus on high margin and volume products, mainly steel industry and agribusiness Log-In has been created to be competitive in the inter-modal business More than 27 thousand individual and institutional investors purchased company shares during the IPO

Beginning of General Cargo

• perations

DCNDB Docenave Argentina Beginning of conteiner transportation in FCA

Log-In IPO

2001 2002 2003 2004 2005 2006 2007

...

Beginning of TVV

• perations

(1998)

CVRD logistics strategy Log-In

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Investments in safety Focus on accidents reduction Preventive actions Operational efficiency Investments in infrastructure, automation, technology and training CVRD environmental policy is an action based on ethics and social commitment

Productivity growth is supported by focus on operational safety and socio- environmental actions

Socio Environmental Responsibility Productivity Safety Strategic drivers

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Logistics overview and strategic drivers Logistics performance and investments Iron ore and coal

General cargo

Operational excellence drivers

“Green railroad”

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CVRD has increased its shipments at 10.7% per year...

Iron ore shipments

million metric tons

1Q 03 2Q 03 3Q 03 4Q 03 1Q 04 2Q 04 3Q 04 4Q 04 1Q 05 2Q 05 3Q 05 4Q 05 1Q 06 2Q 06 3Q 06 4Q 06 1Q 07 2Q 07

39.2 Mt 61.4 Mt

CAGR: 10.7%

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…investing US$ 3.3 billion to expand its railroad and port capacity to meet demand growth…

1,092 649 784 484 274 2003 2004 2005 2006 2007

Logistics investments 2003 to 2007 – US$ 3.3 billion

US$ million

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Vitória a Minas Railroad – EFVM

…in the Southern System…

Vitória a Minas Railroad investments Tubarão Port Complex investments

Implemented: Increase of 110 locomotives and 5,100 wagons in the last 5 years Duplication of Railroad between Brucutu and Costa Lacerda Expansion of railroad yard at Costa Lacerda In progress: Expansion of railroad yards at Drummond and Ipatinga Expansion of railroad yard in Tubarão Complex 28 locomotives and 900 wagons (2008/09) In progress: Overall and services of all existing car dumpers 5th car dumper construction (start-up: 1st Q, 2008) Performance improvement of conveyor belts and replacement of 2 ship loaders

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Tubarão Port – construction of 5th car dumper

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Carajás Railroad - EFC North South Railroad - FNS

…as well as in the Northern System

Carajás Railroad investments Ponta da Madeira Terminal investments

Implemented: Increase of 87 locomotives and 4,856 wagons in the last 5 years Construction and expansion of 10 railroad crossing yards In progress: Expansion of 56 railroad crossing yards Expansion of Carajás and São Luis railroads terminals 40 locomotives and 3,128 wagons (2008/09) Implemented: Addition of Pier III Construction of 4th and 5th ship loaders at pier III Addition of 3rd and 4th loading tracks Addition of storage yards G and H, stackers/reclaimers and conveyors Addition of 3rd car dumper In progress: 4th car dumper Stock yard I, stacker/reclaimer and conveyors

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Railroad crossing and port stock yards

Stock yards G and H – Ponta da Madeira Terminal Expansion of Carajás railroad crossing yards – Location 43

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Carajás Railroad

1 pier 2 ship loaders 2 loading tracks 4 car dumpers 6 stock yards New railroad spur in Carajás region Carajás main line duplication 97 locomotives and 6,613 wagons

Carajás Railroad - EFC North South Railroad - FNS

Expansion of Ponta da Madeira Terminal

In addition, new logistics projects are being developed in the Northern System to attend growing demand in iron ore

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New pier and 2 ship loaders

Expansion of Ponta da Madeira Terminal

6 new stock yards 2 new loading tracks 4 new car dumpers

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Coal in Mozambique will be transported from Moatize through the Sena Line to Beira Port, where it will be loaded into a self-unloading handymaxes Coal will be transshipped on to Panamax and Cape Size vessels fifteen kilometers offshore 1st stage system capacity: 14 Mty

Logistics solutions are being studied for

• ur overseas operations

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Logistics overview and strategic drivers Logistics performance and investments

Iron ore and coal General cargo

Operational excellence drivers

“Green railroad”

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General cargo gross revenues increased at 31% per year…

253 411 548 651 745

Gross revenue evolution

US$ million 1H 03 1H 04 1H 05 1H 06 1H 07

By industry sector

(2006 basis)

7.2% 6.4% 45.1% 38.3% 3.0%

Fuel Building materials Others Steel Agriculture

CAGR: 31%

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FCA Ferroban – FCA Right of Way Southern Coastal Railroad (in construction) Multimodal Terminal

…improving Operational & Financial performance of Centro Atlântica Railroad

Centro Atlântica Railroad - FCA

• Railroad sections renewal
• Improvement of locomotive fleet
• Business re-engineering
• Cost reduction program
• EBITDA turnaround

FCA EBITDA turnaround

US$ million

31.0 36.4 (34.6) 2005 2006 1S 2007

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Plan to develop new logistics infrastructure in Espírito Santo state

Anchieta Viana

Litorânea Sul Railroad

New section that will connect Vitória a Minas railroad to Ubu Port and the south of Espírito Santo state Attraction of steel companies and new general cargo flows 165 km in length Potential demand can exceed 20 mty

Litorânea Sul Railroad

Ubu Port

New terminal feasibility study

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The Norte Sul railroad will provide a new general cargo corridor

Estrada de Ferro Carajás - EFC Ferrovia Norte Sul - FNS Ferrovia Norte Sul – FNS (em construção) Ferrovia Norte Sul – FNS (planejada)

On October 3rd CVRD was awarded the concession to

• perate the 720 Km of FNS

Focus on general cargo exports (mainly soybean, rice and corn) CVRD’s commitment to socio-economic development in Brazil 361 km to be built

Norte Sul Railroad - FNS

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Logistics overview and strategic drivers Logistics performance and investments

Iron ore and coal General cargo

Operational excellence drivers

“Green railroad”

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“Green Railroad” commitment…

By December 2007, CVRD will become the biggest B20 consumer in Brazil This volume equates to the annual CO2 emissions from a city of 27 thousand inhabitants Or it would be necessary to plant an area equivalent to 369 Maracanã stadiums of native forest per year

Until december 2007, EFC and EFVM B20 consumption will be 33 million liters/month

Biodiesel - CVRD is the first Brazilian company using B20 in its locomotives

Approximately 1 million steel sleepers will be installed at EFC and EFVM railroads Environmental impact will be reduced by substituting wooden sleepers with steel sleepers that have double the lifecycle of wood

Railway sleepers replacement

About 400,000 steel sleepers will be replaced per year in both railroads

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…philosophy of operational excellence…

Initiatives to achieve excellence

Longer trains Efficient locomotives Installation of on board computers Higher axle loads Improved operational model

1Q 03 2Q 03 3Q 03 4Q 03 1Q 04 2Q 04 3Q 04 4Q 04 1Q 05 2Q 05 3Q 05 4Q 05 1Q 06 2Q 06 3Q 06 4Q 06 1Q 07 2Q 07 3Q 07

Locomotives Fuel Efficiency

(Liters / GTM x 1000 )

Carajás Railroad trains/day

(Number of trains per day)

AAR* 2006 5.6

* AAR –Association of American Railroads 6.9 12.0

2.15 2.19 2.27 2.32 2.38 2003 2004 2005 2006 1S 2007

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…and to be the safest logistic provider

Initiatives to improve safety

Development of Operational Policy focused on Safety Training centers for train drivers with simulators Automation and process control

Accident rate

(per million train Km)

• 10

20 30 40 50 60 70 80 2002 2003 2004 2005 2006 1H 2007 Centro Atlântica Railroad Vitória a Minas Railroad Carajás Railroad

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Only possible because we are continuously investing in our employees

Investments in technical know-how, enabling logistics staff to face new challenges Promoting the qualification and development of more than 4,000 technical professionals

2006 training numbers Professional Qualification Program 1,748 employees Rail Operations Trail 785 employees Machinists Qualification 713 employees Rail Operations Regulation 367 employees Rail Engineer Program 110 employees

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José Lancaster

Executive Director Copper, Coal, Aluminum

CVRD’s non–ferrous business In focus

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Strategy, highlights and visions

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CVRD continues implementing its strategy for the non-ferrous minerals business

Non-ferrous minerals includes copper, coal, aluminum and others (potash, phosphate, kaolin) business units. Additionally handles CVRD’s global mineral exploration - a key driver of growth. Key strategies Efficient low cost operations (concentrate on cost cutting and efficient maintenance strategies). Develop a consistent pipeline of high quality projects (Paragominas, New Alumina Refinery, Salobo, Moatize). Continuous growth through an organic strategy, JV’s and / or opportunistic acquisitions.

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CVRD continues implementing its strategy for the non-ferrous minerals business

Main focus Aluminum: to develop high quality, low cost bauxite and alumina operations. It also looks for opportunity to vertically integrate the business. Copper: to continue organic growth through implementation of Salobo I

• project. Development of Salobo II, Papomono (Chile), 118, Cristalino, Alemão

projects. Coal: to become a large player in the coal business by 2015, producing more than 30 Mtpy of metallurgical and thermal coal . Potash & phosphate: to position CVRD as a global supplier of raw materials for fertilizers (P & K). Mineral exploration: to continue worldwide efforts to provide efficient resource replacement and additional growth.

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2007 highlights

Paragominas first phase (5.4 million metric tons of bauxite) is completed and operating at a 85% rate. This is the first bauxite pipeline to operate in the world. Phase 3 of Alunorte Refinery (70 % complete) is progressing with total capacity reaching 6.3 MT of alumina by 2008. Salobo I construction of mine-mill copper concentrate complex (100 Kt) started in August 2007, and commissioning is expected for mid-2010. First long term contract signed with a major European copper smelter. Acquisition 100% of AMCI HA (Australia) coal company opening an important new frontier for growth. In 1H07, Chinese coal JV’s (Longyu and Yangkuang) performance exceeded expectations (15% above budget). Implementation of Bayóvar project underway with commissioning in 2010 (world class phosphate deposit in Northern Peru). Total production capacity of 3.9 Mt of phosphate concentrate to be reached in 2013.

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Aluminum industry – CVRD Vision

Access to reliable bauxite source is vital. CVRD holds key resources in the Amazon basin and Africa. Medium and long term market fundamentals should remain strong in the coming years: Aluminum global consumption grew 7% per year between 2001-2006. We expect a similar growth in the next 5 years. Most of the growth driven by the Chinese demand (20% p.a.) . The primary aluminum stocks show a decreasing trend since 2002 (from 9 to 6 weeks). Higher demand from emerging economies (BRICs, Middle East) and rising production costs (mainly alumina and energy) provide a good support to current prices. It is forecasted that supply will keep up with demand. However, given the current scenario (high costs, equipment and personnel shortage) we believe some of new projects may face delays. Therefore, we remain optimistic about the medium–term prices.

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Copper industry – CVRD Vision

Global demand will grow over 4.1 % in 2008-9 (about 600,000 metric tons of new copper production). Copper prices have risen over the past three years given the strong demand and limited

• supply. We are bullish on the prices for 2008-9 and on the long term fundamentals.

China and Southeastern Asia continues to drive overall copper demand growth (10%). European demand is moderate (1.7%), while USA remains flat. Forecasted demand growth will require new supply from greenfield projects under significant pressures: The head grade on major copper operations is decreasing over time; CAPEX and OPEX have risen systematically pressured by both technical and structural factors (ex.: weak dollar); Delay of long lead equipment deliveries (e.g. mills) and short to medium term pressure on key operational items (e.g. tires); Permitting is more complex and lengthier; Important projects are located in remote areas and/or challenging political environments.

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Coal industry – CVRD Vision

CVRD is still a small player in the coal market (~ 2.9 Mt in 2007) with a portfolio focused on metallurgical coal. Our goal is to reach 30 Mtpy of coal through development of CVRD Australia projects, Belvedere, Moatize and other projects by 2015. Current strategy is to supply the steel industry located in Brazil and other markets. We foresee a balanced seaborne market for coking coal, however potential regional unbalance may generate windows of opportunity.

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Fertilizer industry – CVRD Vision

• A number of factors has impacted the agricultural production worldwide:
• “It is still a food game”: world population and GDP growth (about 5 %) will trigger the

increase in food consumption (e.g. an average of 1.4 Mha/y of additional land harvested in China);

• Rising investments in the production of alternative energy (e.g.: ethanol should double

by 2015, according to FAPRI¹);

• Limited additional agricultural land available has led to the improvement of soil

efficiency through higher consumption of fertilizers.

• During the last 12 months, P & K prices increased more than 70%², and industry forecasts

remain bullish.

• CVRD’s Bayovar Project (Peru) represents the only greenfield phosphate rock project

under implementation that targets the seaborne market.

¹ FAPRI - Food & Agricultural Policy Research Institute ² Phosphate rock: from US$ 45/t to US$ 85/t (70-72 BPL, FOB Morocco) and KCl: from US$ 140/t to US$ 240/t. (FOB Vancouver).

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Operations & projects

87

68 98 144 152 167 188 243 254 280 289 327 354 346 327 358 377 429 640 638 674 649 724 $0 $100 $200 $300 $400 $500 $600 $700 $800

1Q 02 2Q 02 3Q 02 4Q 02 1Q 03 2Q 03 3Q 03 4Q 03 1Q 04 2Q 04 3Q 04 4Q 04 1Q 05 2Q 05 3Q 05 4Q 05 1Q 06 2Q 06 3Q 06 4Q 06 1Q 07 2Q 07

aluminium business quarterly gross revenues

MRN expansion to 16.3Mt Alunorte line 3 start up Albras consolidation Alunorte lines 4&5 start up Albras expansion to 406 ktpy Albras expansion to 430 ktpy MRN (16.7Mt), Alunorte (2.5Mt) and Albras (435kt) production records MRN (17.2Mt), Alunorte (2.6Mt) and Albras (446kt) production records MRN (17.8Mt), Alunorte (3.9Mt) and Albras (456kt) production records Valesul consolidation Paragominas start up

Efficient project execution and higher prices drove CVRD’s aluminum business revenues to a record high in the 2Q07

Aluminum

88

Aluminum operation and expansion

Paragominas project

Paragominas first phase ramp-up nearly completed (5.4 Mtpy):

First bauxite mine in the world to use

a pipeline for ore transportation. First batch received by Alunorte in March.

Expansion to 9.9 Mt of bauxite is

67% completed. The third expansion will consolidate Alunorte position as the largest alumina refinery in the world

• Global physical progress over 70%

completed. Total refinery capacity to reach 6.3 Mtpy.

• To be commissioned in 1H08.

Alunorte expansion

89

The development of a new refinery will strength CVRD asset base in the upstream of the aluminum chain. There is still room for growth.

CVRD signed a MoU for the development of a new alumina refinery with an initial production capacity of 1.86 Mtpy. The new refinery will replicate Alunorte experience. Bauxite will be supplied by Paragominas. Given its world class bauxite deposits, CVRD can expand the new refinery up to 7.44 Mtpy.

Alumina project under development

90

Copper operations

Sossego mine

First CVRD copper mine with 3 full years of operation: 90 % of capacity (125 kt Cu)

• achieved. Exceeded financial returns due to the good startup timing and soaring of

copper prices. More than 1.4 Mt of concentrate already mined and shipped through long term contracts, since the beginning of the operation. Experience at Sossego consolidated CVRD’s copper mining knowledge to be applied in the development of the Carajás copper project pipeline (Salobo implementation underway).

91

Copper project under construction

Salobo

Construction started in August 2007. Phase 1 designed to produce 100 kt of copper-in-concentrate (@ 38% Cu and 15g/t Au). Total investment: US$ 897 M. First long term agreement already signed with a major European copper smelter. 2nd phase of Salobo under evaluation (an additional of 100 kty contained copper).

92

Hydrometallurgical copper plant (UHC)

Application of new technology for complex ores

• CVRD is currently at 90% of construction of a 10 ktpy hydrometallurgical-

copper-plant located in Carajás. The purpose is to consolidate hydromet technology in treating copper sulphide concentrates, using CESL technology.

• Workforce for operation already trained.
• Start up scheduled for 1Q08.

93

Copper projects under development at different stages

Cu kty Cristalino Estimated production Project 118 (Sx-Ew) 36 Alemão* 100

• Reserves

Proven & probable

(Concentrate) Cu % Au (g/t) ROM content

Papomono, Chile

0.95 0.66

• 64

379

• 0.15
• Mt
• *PFS ongoing.

Papomono*

• (Sx-Ew)

94

Australia Mozambique China

Yankuang JV (25%) 2.0 Mtpy – Coke ¹ Longyu JV (25%) 6.0 Mtpy – Anthracite ¹

Moatize 11 Mtpy Coking/Thermal coal Belvedere (pre-feas. phase) 8 Mtpy Coking coal/PCI

CVRD Australia 11 Mtpy Coking coal/PCI/Thermal

¹ Total production capacity

CVRD coal operations and projects Potential production

95

CVRD Australia

• In April 2007, CVRD acquired 100% of AMCI Holdings Australia Pty Ltd (AMCI HA).
• CVRD Australia owns and operates several coal mines and holds mining rights in

Australia, through equity unincorporated joint ventures

• About 2.9 Mt are estimated to be the CVRD Australia’s production in 2007.
• The Australian operations allow CVRD to have an experienced workforce in both

underground and open pit operations. JV’s in China

• Longyu anthracite JV’s performance in 1H07 exceeded expectations with

production of 2.8 Mt compared to a budget of 2.4 Mtpy.

• Yankuang coking JV production in 1H07 was also above budget: 0.6 Mt compared

to 0.5 Mt. Coke quality is mainly grade A (high quality) and methanol production has already started.

Coal operations

* Mines have not reached production @ full capacity. By 2010, it is expected coal production of 11 Mt (US GAAP) equivalent to 8 Mt on equity basis

96

Moatize

• Following the approval of the project development plan by the Mozambican

authorities in early June, the Government of Mozambique approved the mining right for the development and implementation of the Moatize coal project.

• The project involves the exploitation of an open pit mine (> 30 years life), with an

estimated average annual production of 11 Mt of coal products – 8.5 Mt of metallurgical coal and 2.5 Mt of thermal coal. Belvedere

• CVRD has exercised a call option to acquire a 51% interest in the Belvedere Coal JV

(hard coking coal with high quality).

• CVRD has a further option to raise its stake in the project up to 100% by acquiring

the remaining 49% interest at a fair market value to be determined at the time of the exercising of the option.

• Feasibility study underway.

Coal projects

97

Potash

UOTV, Carnalite & Neuquén

Sole domestic producer, contributing with 12% of Brazilian consumption. ROM production capacity achieved 3,000 ktpy. Two other significant opportunities being investigated: Carnalite (Sergipe - Brazil) Potash project (Neuquén - Argentina).

98

Phosphate rock

Bayóvar

Located in Sechura desert (Peru), Bayóvar project startup is scheduled for mid-2010. Estimated production of 3.9 Mt of phosphate concentrate. Life of mine: 27 years. Total investment (Capex): US$ 479 million, including infrastructure Implementation phase underway: Permits and licenses already granted (sea area for pier construction & operation; sea water supply). Team already defined. Commercial highlights Initial approach with potential customers underway. Target markets: South and North America, Oceania and Asia.

99

Mineral exploration

100

CVRD remains focused on long-term organic growth

With the recent acquisitions of INCO and AMCI, CVRD has consolidated its exploration activities under a single “Global Mineral Exploration” hat. Such consolidation allows more efficiency and agility integrating exploration, and mineral technology activities under a global organization. Total budget for 2007 R&D: US$ 452 million Pre-F/S, F/S and technology: US$ 302 million Mineral exploration & project development to pre-feasibility: US$ 150 million

Copper Nickel Iron Ore Bauxite Potash Other

Cordillera- S.America Africa Australasia Eurasia North America South America

2007 budget per region 2007 budget per mineral

101

Previous offices New offices Exploration programs & projects

A global and multi-commodity exploration program

13 exploration offices

102

New projects worldwide in 2007

Papomono Papomono Copper Project Copper Project Chile Chile New grassroots New grassroots programs for programs for copper in copper in Democratic Democratic Republic of Congo Republic of Congo (new office) (new office) Copper Copper Program in Program in Kazakhstan Kazakhstan Coal Coal project in project in Mongolia Mongolia New Office New Office in Colombia in Colombia Bauxite Bauxite Project in Project in Guinea Guinea Grassroots Grassroots programs in Canada programs in Canada including U & Cu including U & Cu Grassroots programs Grassroots programs in Australia including in Australia including U & coal U & coal

103

Making it happen

José Carlos Martins

Executive Director of Ferrous Minerals

104

INDEX

Steel & Iron Ore Market Trends CVRD Strengths and Initiatives Cost-reduction efforts

105

INDEX

Steel & Iron Ore Market Trends CVRD Strengths and Initiatives Cost-reduction efforts

106

Global crude steel production grew by 100 Mt in 2006 and is expected to reach almost 1.5 billion tons in 2010. Such level of growth has no parallel in

• history. China continues to be the main driver of steel production growth.

Global crude steel production

722 748 787 783 816 222 281 356 423 905 580 182 '02 '03 '04 '05 '06 '10f 904 970 1,068

CAGR 05-10 +5.4% +10.3% +2.9%

World Rest of the world China

1,139

Sources: IISI and CVRD estimates

1,485

Mt

CRUDE STEEL PRODUCTION (Mt) CRUDE STEEL PRODUCTION (Mt)

1,239

107

Forecasts of crude steel production have missed by far the actual achievements of the steel industry. We are trying to catch up with such speedy development.

Global crude steel production

816 782 762 782 805 193 248 314 366 798 401 423 '06 Mar-02 Mar-03 Mar-04 Apr-05 Apr-06

World Rest of the world China

Sources: IISI and CRU

Mt

1,239 975 1,010 1,096 1,171 1,199

Past Forecasts of Crude Steel Production for 2006 Past Forecasts of Crude Steel Production for 2006

• 264 Mt
• 40 Mt
• 68 Mt
• 143 Mt
• 229 Mt

Actual

108

2006 2007e 2008f

+9% +6% +8% +12% +7% +5% +15% +4%

• 5%

+11%

Source: IISI Oct, 2007

IISI forecasts world steel consumption to keep strong in the coming years Others China Asia ex. China EU (27)

1,279 1,198 1,121

CIS & other Europe

+6.8% +6.8% +6.8% +6.8%

World

Steel consumption

NAFTA

+4% +2%

Apparent consumption of finished steel (Mt) Apparent consumption of finished steel (Mt)

109

The surge of BRICs and the synchronized global economic growth have changed the steel industry landscape during this decade

Evolution of steel industry

• Sluggish demand
• Low prices and struggling results
• Regional Players
• Consolidation for rationalization
• Financial market perception:

unattractive

• Leadership by companies from

developed economies

• Divestiture of non-core assets

(Ex. Raw materials)

• Strong demand
• Record prices and profits
• Global players & Shift in

demand to East

• Consolidation for growth
• Financial market perception:

profitable

• Growing importance of

companies from BRICs

• Desire to secure

raw material supply Early 2000’s Early 2000’s Currently Currently

Question: could India become a new China? Question: is steel a “sunset” Industry? Changing the Mindset

110

Where... Where...

North America, Europe, CIS, South America, Africa, China Japan, USA, China Europe, India, USA, Southeast Asia USA, Europe USA, Canada, Mexico, Europe

Yesterday: regional groups Yesterday: regional groups Today*: global presence Today*: global presence

Consolidation of the steel industry

Consolidation contributed for greater discipline on supply side: focus on prices and not in volumes.

* 2006 production

111

A new growth cycle

Asia (Ex. China) North America China World South America Western Europe Africa / Middle East Eastern Europe / CIS

Source: IISI, CVRD

135 137 39 62 25 47 212 279 127 580 178 205 130 178 848 1.485

2000 2010e

Crude Steel Production (Mt) Crude Steel Production (Mt)

CAGR 6% CAGR 6% CAGR 0% CAGR 0% CAGR 1% CAGR 1% CAGR 5% CAGR 5% CAGR 3% CAGR 3% CAGR 16% CAGR 16% CAGR 3% CAGR 3% CAGR 7% CAGR 7%

112

60 80 100 120 140 160 180

abr/94 abr/95 abr/96 abr/97 abr/98 abr/99 abr/00 abr/01 abr/02 abr/03 abr/04 abr/05 abr/06 abr/07

ind ex

CRUspi Global Index

Jun ‘07 Jun ‘07 New New Record! Record!

Source: CRUspi

Steel industry – prices performance

Steel prices continue to fluctuate at higher levels.

Average ‘03 to ’07 141 pts China Boom! Average 94 to ’02 92 pts

113 * NSC, POSCO, Arbed, Ispat, Usinor, NKK, Corus & ThyssenKrupp ** AM, NSC, POSCO, JFE, Baosteel, US Steel, Nucor & Corus *** Average Value from 2000 until mar/07

19% 12% 2000* 2006** 259 42 2000* 2007**

Top 8 Steelmakers average Ebitda Margin (%) Top 8 Steelmakers average Ebitda Margin (%) Top 8 Steelmakers Market Cap (US$ billion)*** Top 8 Steelmakers Market Cap (US$ billion)*** Healthy demand and high steel prices led the industry to a new level of profitability and encouraged a better perception from the market.

Steel sector environment

Sources: Bloomberg, Company reports, CVRD

114

Seaborne demand is not being fulfilled due to supply restrictions.

Seaborne iron ore trade

Sources: IISI, UNCTAD, CVRD

Demand

+14.2%

373 389 400 400 405 455 148 203 270 320 525 111

´02 ´03 ´04 ´05 ´06 '10f

484 725 537 603 670

+7.9% +2.6%

World

China as a % of total

27% 37% 54%

Rest of the world China

CAGR 05-10

980 Million tons

115

Chinese iron ore consumption

Source: CVRD and Tex Report

Chinese iron ore consumption profile Chinese iron ore consumption profile

If there is

availability, further increase in imports can be achieved through replacement

• f domestic low grade,

high cost ores.

If there is

availability, further increase in imports can be achieved through replacement

• f domestic low grade,

high cost ores. Imported iron ore has been gaining substantial share in China. Limited seaborne supply availability restricted further gains in 2005 and 2006

100 200 300 400

1999 2000 2001 2002 2003 2004 2005 2006e

(M tons) 30% 60% 90%

Domestic ore (conc.) Imports Domestic / total

• - 45%

70%

Domestic ore is

losing its competitiveness due to very low Fe content in the ROM and currency appreciation.

Domestic ore is

losing its competitiveness due to very low Fe content in the ROM and currency appreciation.

116

World pellet consumption will increase almost 40% until 2010. DR route should increase its share to 25% in the period. Mostly due to new projects in Middle East countries.

Steel industry pellet demand

224 365 57 120 281 71 500 2003 2004 2005 2006 ……. 2010e

DR BF 485 280 Million tons Total 352

Source: CRU

20% 80% 25% 75%

World Pellet consumption World Pellet consumption

+133

117

60 70 80 90 100 110 120 130 140 150 160 170 69 71 73 75 77 79 81 83 85 87 89 91 93 95 97 99 01 03 05 07 (1970=100)

Iron ore benchmark price index

In real terms, the iron ore benchmark price for fines is just recovering from the same level of the early seventies.

Growth of Chinese Steel Industry The Era of “Efficiency”

(technological changes & oversupply)

Early years of Seaborne

Iron ore price index (1970 = 100)

Real Prices – Ago 07 – deflated by US CPI

Iron ore price index (1970 = 100)

Real Prices – Ago 07 – deflated by US CPI

Source: CRUspi

CVRD’s commitment to the Benchmark Price Index is represented by its long term investments plans to expand capacity, improving long-term relationship among the players

The Benchmark System brings stability to the market as long as it reflects the market reality

118

• 10

20 30 40 50 60 70 80 90 set/05 jan/06 mai/06 set/06 jan/07 mai/07 set/07 West Australia-Baoshan Tubarão-Baoshan Tubarão-Rotterdam

50 70 90 110 130 150 170 190 set/05 jan/06 mai/06 set/06 jan/07 mai/07 set/07

Domestic Concentrates (Thangshan/Hebei) Indian spot FOV w mt Tianjin (Fe@63.5%) SSF CFR Beilun

Weekly Seaborne Freight Rate (US$/ton) Weekly Seaborne Freight Rate (US$/ton) Weekly IO Prices in China (US$/ton) Weekly IO Prices in China (US$/ton)

Iron ore spot prices have increased by ~95% since the beginning of 2007… …an indication that the balance between supply & demand should remain tight for the next years.

Source: Clarksons Source: Mysteel, Clarksons & CVRD

Iron ore tightness to continue …

119

INDEX

Steel & Iron Ore Market Trends CVRD Strengths and Initiatives Cost-reduction efforts

120

CVRD`s resources are at least 5x larger than its proved reserves, which are capable of attending the present demand for 32 years.

7 mines

Northern System

2.0 Bi 12 mines 3.9 Bi

Southeastern System

9 mines 1.7 Bi

Southern System

Reserves (t)1

84 Mi

Production 20062

82 Mi 97 Mi

8.6 Bi 271 Mi

TOTAL CVRD2

Samarco

1 mine 1.0 Bi 8 Mi

Reserves base

1) Proven & probable reserves, as of December 2006. Samarco considers total reserves . Northern System' reserves includes N5S & Serra Leste; 2) Does not include Southern System third parties purchasing. Includes 50% CVRD shares in Samarco

CVRD has the largest reserves base in the industry

121

Korea 4% China 27% ROW 13% Europe 25% Brazil 21% Japan 10%

CVRD iron ore and pellets sales – 20061 CVRD iron ore and pellets sales – 20061 Total 276Mt

CVRD: the only iron ore global player

With complete product portfolio, combined with customer-oriented marketing approach, CVRD has been able to supply its customers around the globe.

Sources: CVRD and IISI

1 CVRD + 50% Samarco + Pelletizing JV´s (Nibrasco, Itabrasco, Kobrasco, Hispanobras) + Urucum.

122

Product Line: ore and coal, pillars of the steel industry. Combining the strenghts of Brazil and China.

JV - Baovale

• Start-up: 2002
• Iron Ore Prod.: 6Mt/y
• Start-up: 2006
• Coke Prod.: 2Mt/y

Exploring sinergies

New areas of cooperation for CVRD and CSM

JV – Yankuang

• Start-up: 2006
• Coke Prod.: 2 Mt/y

JV - Longyu

• Start-up: 2005
• Raw Coal Prod.:

6 Mt/y JV – CSV

• Start up: 2011
• Steel Capacity: 5 Mt

JV - Zhuhai YPM

• Start-up: 2007 (F)
• Pellet Prod.: 1.2 Mt/y

123

25 28 36 41 54 76 97 2001 2002 2003 2004 2005 2006 2007e

(Mt)

CVRD’s iron ore & pellets sales to China CVRD’s iron ore & pellets sales to China From 2002 to 2006, mostly of CVRD‘s production increase was shipped to China under Long Term Contracts.

Exports to China

CVRD expansions have been supporting China’s strong demand for raw materials.

124

Initiatives

CVRD is analyzing and implementing several initiatives to reduce landed costs and increase its competitiveness. Use CVRD’s large scale and expertise to provide support to its customers where applicable. Promote the construction of dedicated VLOCs to reduce demand pressure for fronthaul trips. Virtual mine. CVRD blend.

125

Chinamax Vessels

Larger vessels should provide important economy of scale, contributing to reduce Brazil-China freight cost.

126

Chinamax Vessels: narrowing the distance between Brazil and China.

Main Advantages of Chinamax Vessels

• Vessel scale can bring significant cost reductions

per ton;

• Reduction on freight rates and volatility on a long -

term basis;

• Predictability of delivery can also be improved with

gains on the whole supply-chain;

• Ports in China and Brazil are ready to handle these

vessels. CVRD is ready to analyze joint investments in sea transportation together with its main Chinese customers and partners.

Chinamax Vessels

127

Pellet plants initiatives

CVRD will enhance even more its presence in the pellet market. The main drivers for increasing consumption of pellets worldwide are: Relevant growth in new DRI capacities (mainly in Asia and Middle East). Decrease of lump ore quality. BF’s productivity improvements and environmental concerns. Increasing pellet feed availability.

128

Pellets expansion pipeline

New pellet plants in China and Malaysia under evaluation with local partners.

CVRD plans several projects for pellets in order to meet additional demand from DR and BF sectors. Capacity Start-up increase (Mtpy) JV Zhuhai 1.2 Jan/2008

Under construction

Samarco (1) 7.6 Mar/2008

Under construction

Itabiritos 7.0 Jun/2008

Under construction

Tubarão VIII 2H/2010

Submitted to Board approval

Oman (2) 9.0 1H/2010

Feasibility

7.5

1 Samarco a 50/50 JV. Its projects is not included in CVRD Capex program. 2 Subject to Board approval.

129

Itabiritos Pellet Plant Complex will come on stream on June 2008.

Itabiritos Pellet Plant

130

■ CSA (ThyssenKrupp) – Under Construction

• Capacity:

5.0 Mtpy

• Estimated start-up:

2009

■ CSV (Baosteel)

• Capacity:

5.0 Mtpy

• Estimated start-up:

2011

■ Ceará Steel (Dongkuk/Danieli)

• Capacity:

1.5 Mtpy

• Estimated start-up:

2010

Fostering iron ore consumption in Brazil by attracting steelmaking projects and taking advantage of the trend towards geographical relocation of global steel capacity.

Steel – Joint Ventures

Additional 18 Mtpy of iron ore consumption in the domestic market under Long Term Contracts

131

CSA is scheduled to start operating in 2009.

CSA (ThyssenKrupp)

132

2001 2007E 2012E

*Considering projects subject to Board Approval. *Considering projects subject to Board Approval. 450Mtpy production rhythm expected to be achieved in Dec/2012. 450Mtpy production rhythm expected to be achieved in Dec/2012.

Future Iron Ore Production

CVRD is implementing aggressive expansion projects to meet the rising market demand. We expect to achieve production capacity of 450 Mtpy* in 2012, from 300 million in 2007.

CAGR CAGR +15% +15% CAGR CAGR +7% +7% 422* 422* 134 134 300 300

CVRD Iron Ore Production (Mt) CVRD Iron Ore Production (Mt)

450 Mt by Dec.2012

133

CVRD has restructured its manganese operations in order to focus on the company’s core business and to optimize its mineral resources.

RDM Bahia Barbacena Corumb á Ouro Preto Santa Rita Mina do Azul Mina de Urucum Minas Bahia Morro da Mina São João Del Rei Florestas BA Florestas MG Florestas MS

Ligas Ligas especiais CaSi , FeSie CoredWire Florestas Minas

RDME RDMN

Modelo Atual Manganês Após Reestruturação

RDM Bahia Corumb á Ouro Preto Mina do Azul Mina de Urucum Morro da Mina

Ligas Minas

RDME RDMN

Northern System

X X X X X X

RDM Bahia Barbacena Corumb á Ouro Preto Santa Rita Mina do Azul Mina de Urucum Minas Bahia Morro da Mina São João Del Rei Florestas BA Florestas MG Florestas MS

CaSi , FeSie CoredWire

Special Alloys Ferro Alloys

CaSi , FeSie CoredWire

Forests Mines

RDME RDMN

Actual Model Manganese After Restructuring

RDM Bahia Corumb á Ouro Preto Mina do Azul Mina de Urucum Morro da Mina

Ligas Minas

RDME RDMN

Southern System

X X X X X X Assets Sold

Manganese operations

Ferro Alloys Mines

134

Divestments Evolution

Floresta - MS Floresta NMG CaSi/ CW NovaEra Floresta SMG Floresta BA

2006 2007 Total

6 Assets Total: US$ 90 MM Real Estate

Manganese Operations

Divestments of non-core and non-operational assets have reached US$ 90 million dollars in the last two years.

135

INDEX

World Steel Industry CVRD Strengths and Initiatives Cost-reduction efforts

136

The aggressive CVRD volume growth since 2001, associated with a global mining boom, has led to an increase in unit costs.

Since 2006, CVRD established a Cost Reduction Program to bring unit cost back to 2004 level

Cost Growth Main Drivers High marginal cost

• Production reaching capacity
• Suppliers growth constraint
• Strengthening of local currency and suppliers prices pressures
• Productivity (deeper pits, longer distances, increasing waste, lower iron ore content)

233 152 144

2001 2002 2005 2006

Cost US$/ton constant currency (100 base)

Production Cost vs. Annual Production

2003 2004

170 192

Production Mton

2007

263 300 113 175 100 139 145 179 172 95 215 119 119 206 173

Cost US$/ton (100 base)

137

CVRD Cost Reduction Program Embraces Several Initiatives, such as:

Automation Integration Shared Services Shipping Low Cost Plants Productivity Portfolio Management

High investments on Automation Platform to improve asset utilization, quality, efficiency and safety, as well as:

• Predictive maintenance technologies
• On-line quality control
• Operation at the optimum point
• Reduction of supplies and energy

consumption

• Automation of critical procedures

reducing human error

• Environmental impact reduction
• Minimize work safety risk

Contracts Revision

138

Automation Integration Shared Services Shipping Low Cost Plants Productivity

CVRD Cost Reduction Program Embraces Several Initiatives, such as:

Portfolio Management

Acquisition of new companies, bringing new cost reduction opportunities through:

• Economy of scale
• Exchange of Best Practices on

production processes

• Stock Optimization
• Contracts Synergies
• Technology Sharing
• Equipment and staff pool
• Integration of MBR as part of CVRD’s

Southern System

Contracts Revision

139

Automation Integration Shared Services Shipping Low Cost Plants Productivity

Shared Services implementation to support CVRD’s global growing and acquisitions trough gains of scale and efficiency on processes.

High Low Service Level Low High Efficiency Shared Services Descentralized Model Centralized Model

CVRD Cost Reduction Program Embraces Several Initiatives, such as:

Portfolio Management Contracts Revision

140

Automation Integration Shared Services Shipping Low Cost Plants Productivity

A fleet of dedicated Very Large Ore Carriers under long term Contracts of Afreightment will contribute to increase competitiveness and reduce volatility of freight rates in the Brazil-Asia route. CVRD shipping strategy also includes

• ffshore blending and distribution

capability.

CVRD Cost Reduction Program Embraces Several Initiatives, such as:

Portfolio Management Contracts Revision

141

Automation Integration Shared Services Shipping Portfolio Management Low Cost Plants Productivity

CVRD products portfolio optimization as a tool for production maximization, processes stabilization and cost reduction.

CVR CVRD P PROD ODUCTS PORT RTFOLIO O OP OPTIMIZATION ON CVR CVRD P PROD ODUCTS PORT RTFOLIO O OP OPTIMIZATION ON

SUSTENTABI SUSTENTABI LITY LITY COMPETITIVI COMPETITIVI NESS NESS FLEXIBILITY FLEXIBILITY INTEGRATED INTEGRATED SYSTEMS SYSTEMS CAPACITY CAPACITY COST REDUCTION COST REDUCTION

ST STRATE TEGY ST STRATE TEGY

CVR CVRD P PROD ODUCTS PORT RTFOLIO O OP OPTIMIZATION ON CVR CVRD P PROD ODUCTS PORT RTFOLIO O OP OPTIMIZATION ON

SUSTENTABI SUSTENTABI LITY LITY COMPETITIVI COMPETITIVI NESS NESS FLEXIBILITY FLEXIBILITY INTEGRATED INTEGRATED SYSTEMS SYSTEMS CAPACITY CAPACITY COST REDUCTION COST REDUCTION

ST STRATE TEGY ST STRATE TEGY

MA MARKET ET SU SUPPLY

CVRD Cost Reduction Program Embraces Several Initiatives, such as:

Contracts Revision

142

Automation Integration Shared Services Shipping Low Cost Plants Productivity

CVRD new plants play a key role in the program due to their intrinsic production low unit cost. Additional 150 Million tons will benefit from improved efficiency and technology of new plants.

CVRD Cost Reduction Program Embraces Several Initiatives, such as:

Portfolio Management Contracts Revision

143

Automation Integration Shared Services Shipping Low Cost Plants Contracts Revision Productivity

Ostensive contracts revision, driven by:

• Performance based contracts
• Intelligence building
• Make or Buy analysis
• Development of new suppliers
• Consolidated procurement in regional

basis

• Rationalization of contracts,

eliminating redundancies and improving efficiency

CVRD Cost Reduction Program Embraces Several Initiatives, such as:

Portfolio Management

144

Automation Integration Shared Services Shipping Low Cost Plants Productivity

Productivity improvement:

• Debottlenecking of existing assets
• Improvement in production process

controls

• Maximizing the use of geological

resources

• Brazilian blending (Carajás ores +

Southern System ores)

CVRD Cost Reduction Program Embraces Several Initiatives, such as:

Portfolio Management Contracts Revision

145

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